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Tuesday, June 28, 2011

A Country with no Money?

It’s the 1st week of holidays! I don’t get much more than a week but I’ll make the most of it. Went to play some golf with a friend today, learnt that a bad day of golf beats any day in work lol.

So Greece huh. Whats going on there? How does a country go bankrupt? I guess some countries are run sorta like a company. The president being the CEO, treasurer being the auditor/accountant, elections being the company's AGM and people get to vote for their leaders.

Like companies, countries can borrow money, lend money, have a line of credit, invest in different assets, make a profit and loss. So I guess if countries can do all that, they should be able to go bankrupt as well. What happened after Bear Stearns and Lehman Brothers went bankrupt? Chaos. What is gonna happen when a country goes bankrupt? I’m afraid to imagine.

What happens when a company is at the risk of going bankrupt? They sell their shares at a low price to raise money, they get a new line of credit, the sell some of their assets, they look for a buyer, etc. What can a country do if they are at the risk of bankruptcy? Sell one of it's islands to a rich individual? Get a line of credit from another country? Sell some bonds? I don’t know what do you think?

I think it most certainly wont be good when and if Greece goes bankrupt, its such a small country but it will most certainly have a ripple effect that will and can be felt around the world

Tell me what do you think? What are some of the solutions that you can come up with? Should the EU help out their poor brother? Whats gonna happen if Greece runs out of cash?

Thanks for reading, do drop me comments or emails in response to this post or older posts or to let me know if u hate or like the new look of the blog. J